What happened

Shares of Intuitive Surgical (ISRG 0.00%) rose by 17.9% in April 2023, according to data from S&P Global Market Intelligence. The gains were driven by a surprisingly strong earnings report, followed by a flood of bullish analyst notes.

So what

The company behind the da Vinci line of robotic surgery systems beat Wall Street's expectations soundly in the first quarter of 2023. Earnings rose 9% year over year to $1.23 per share, while revenue increased 14% to $1.7 billion. Your average analyst would have settled for earnings near $1.20 per share on top-line sales of approximately $1.6 billion.

Intuitive Surgical's worldwide da Vinci procedures grew approximately 26% in Q1, and the company delivered 312 da Vinci Surgical Systems, compared with 311 in the same quarter last year. Regulators around the world approved several new da Vinci procedures in the reported period and after the earnings report, expanding the company's target market.

Now what

These healthy results were achieved amid coronavirus challenges on both ends of the year-over-year comparisons. That being said, Intuitive Surgical's plan of action is pretty much the same as always -- you don't change a winning recipe.

"Our core business was lifted by positive surgical trends and continued interest in robotic-assisted surgery when compared with other surgical approaches," said Intuitive CEO Gary Guthart. "We continue our focus on increased adoption, the pursuit of expanded indications and product launches, excellence in supply and product quality, and increased productivity as we scale our business."

Same old same old. As a longtime Intuitive shareholder, I don't mind that at all.

Intuitive Surgical's profit model is driven by the big-ticket sales of da Vinci Surgical Systems, as well as by renewable revenue streams generated by the sale of services, supplies, instruments, and accessories related to those machines. The substantial initial investment may limit the number of da Vinci systems the company can ship out in any particular period, but it also motivates the buyer to make good use of their serious capital investment.

Ergo, sales of instruments and accessories should rise over time, come what may. This segment accounted for 59% of Intuitive's sales in this quarter, up from 54% a year ago.

Although Intuitive Surgical's valuation is relatively high at 83 times earnings and 16 times sales, the company's explosive growth potential in disrupting the global market for surgical procedures still makes it a promising investment opportunity.